Canada’s Kirkland Lake Gold (TSX, NYSE: KL) (ASX:KLA) is buying smaller rival Detour Gold in an all-stock deal worth C$4.89 billion ($3.7 billion) growing the already large list of mergers and acquisitions to have swept the sector this year.
Kirkland is offering 0.4343 shares to Detour Gold
shareholders for each share held, which represents a premium of 23.8% to
Friday’s closing price.
The deal, which will help the Toronto-based miner scale up
its operations and boost reserves, is expected to generate pre-tax savings of
about $75 to $100 million per year, the companies said in the statement.
Once the transaction is completed, Kirkland Lake Gold and
Detour Gold shareholders will own about 73% and 27%, respectively, of the
merged company.
More to come…